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HMRC internal manual

Insurance Policyholder Taxation Manual

HM Revenue & Customs
, see all updates

Assignments: specific exceptions by legislation

There are certain assignments that are specifically prevented by the legislation frombeing chargeable events.

Assignments between spouses or civil partners

An assignment of all or part of the rights under a policy or contract between spousesor civil partners living together is disregarded for the purposes of the chargeable eventlegislation. This means that it does not give rise to a chargeable event, even if it isfor money or money’s worth, and neither are there any implications for calculationsof gains on later events. If an insurer is aware that an assignment between spouses orcivil partners has occurred and has no information to indicate that they do not still liveat the same address then it may assume that there is no chargeable event and that there isno need for chargeable event certificates.

Assignments by way of security for a debt or on discharge of a debt

An assignment of all or part of the rights under a policy or contract is alsodisregarded if it is

  • by way of security for a debt, for instance to a lending bank, or
  • on the discharge of a debt secured by all or part of the rights, for instance reassignment by the bank when the loan is paid off.

If an insurer holds information to show that an assignment was made in these specificcircumstances then it should not issue chargeable event certificates.

Further reference and feedback IPTM1013